Evercore ISI does not believe Sears is a viable retailer in its current form, and a liquidity event is a matter of when, not if. The firm's analyst said Sears' cash situation has deteriorated, making additional debt issuance more likely in 2016 with a larger liquidity event possible in 2017. Evercore has a base case of $4 per share on Sears based on its SOTP analysis.

02/09/16

EVER

02/09/16NO CHANGEEVERSell

Sears liquidity event a matter of 'when, not if,' says Evercore ISI

Evercore ISI analyst Greg Melich said the preliminary Q4 financials released by Sears showed comparable sales were worse than he expected at the flagship brand and at Kmart and that its margins were also worse than he thought. Sear's cash situation has gotten worse, making additional debt issuance more likely in 2016, Melich tells investors, adding that he believes "a liquidity event is a matter of when not if," and may be possible in 2017 at the current burn rate. The analyst keeps a Sell rating on Sears shares.

UP AFTER EARNINGS: Cintas (CTAS), up 2.9%... Micron (MU), up 2.8%. ALSO HIGHER: Editas Medicine (EDIT), up 3.1% after it received the EMA's orphan medicinal product designation for EDIT-101... Twitter (TWTR), up 1.8% after it said it will start testing longer, 280-character tweets with a small group. DOWN AFTER EARNINGS: Nike (NKE), down 3.2%. ALSO LOWER: Kornit Digital (KRNT), down 12.2% after it cut its third quarter revenue guidance... Westlake Chemical Partners (WLKP), down 8.3% after it filed to sell 4.5M units for limited partners... Intra-Cellular (ITCI), down 7.2% after it filed to sell $150M in common stock... Ascendis Pharma (ASND), down 4.3% after it announced an offering of $125M of ADSs.